Chery and ChanganTurn to Cooperation to Expand Overseas Markets

Gasgoo.com (Shanghai Dec 8)–Changan Automobile Group and Chery Automobile Company, two of China’s domestic automakers, are “in a relationship”, revealed Jian Li, Vice Manager of Overseas Business at Changan Automobile, during the Summit on Merger and Acquisition Strategies for Chinese Automotive Corporations in the Overseas Markets, these two companies are now discussing possible cooperation in overseas markets. To be noted, Changan and Chery had already discussed the possibility to develop a common financing platform in Brazil market in the past so as to share cost and enhance competitive power.

It’s believed that Chinese automakers’ demands to expand overseas markets and their relatively weak international competitive power are the two main causes to initiate this cooperation.

This year, China’s car production volume is expected to reach 24.95 million units and this number will keep increasing to 30 million by the year of 2020, which far exceeds China’s domestic market demands. Competition at home has forced Chinese brands to go global, especially in emerging markets. Besides, Chinese government also mentioned, in China’s Thirteenth Five-Year Strategy, in order to further develop China’s automobile industry, Chinese automobile corporations must go global and compete in the international markets.

However, “going global” means the relatively immature Chinese automakers will be exposed directly in a much more complicated international environment influenced by fluctuating exchange rate, depressing global economy, geopolitics and regional economic policies.Under this circumstance, Chinese corporations must turn to cooperation to share cost, enhance competitiveness and lower legal risks.

Furthermore, Auto experts believed that,to compete in the international markets, Chinese carmakers also must focus on expanding brand influence, introducing superior products, and providing better services.